By Bruno Federowski
SAO PAULO, June 28 (Reuters) - Latin American currencies
jumped on Tuesday as investors scooped up bargains following a
sell-off triggered by Britain's decision to leave the European
Union.
The Mexican peso registered its biggest rise
since Feb. 17, finishing the day at 18.837 per dollar, 1.79
percent above Monday's reference price.
But the currency remained near historical lows, with
analysts forecasting the central bank could raise interest rates
at this week's policy meeting to fight off price pressures.
"I don't think there is a need to hike but Banxico has put
itself in a corner by focusing on the Mexican peso too much,"
4Cast economist Pedro Tuesta said. "The market has basically
priced in a hike and therefore could be disappointed by the lack
of a hike."
The Colombian peso also rebounded, finishing up 2.48 percent
against the dollar, helped by higher oil prices.
The Brazilian real rose more than 2.5 percent to its
strongest in almost a year, in line with the rebound in other
world markets.
Brazil's central bank reiterated on Tuesday it had no plans
to reduce rates, saying it aimed to keep inflation inside the
government's target band this year despite market expectations
it could fail to do so.
Traders also perceived hawkish overtones in comments by
central bank Governor Ilan Goldfajn later on Tuesday.
"Those who believed Goldfajn could have a dovish inclination
will have to reassess this conviction," Absolute Investimentos
partner Renato Botto said.
Key Latin American stock indexes at 00.10 GMT:
Stock indexes daily % YTD %
change change
Latest
MSCI Emerging Markets 807.32 0.26 1.4
MSCI LatAm 2143.50 2.91 17.14
Brazil Bovespa 50006.56 1.55 15.36
Mexico IPC 44714.54 0.98 4.04
Chile IPSA 3936.03 -0.73 6.95
Chile IGPA 19464.93 -0.63 7.24
Argentina MerVal 14141.52 2.66 21.12
Colombia IGBC 9706.43 0.3 13.56
Venezuela IBC 13067.06 -1.26 -10.43
(Reporting by Bruno Federowski; Additional reporting by
Priscila Jordão; Editing by Andrea Ricci and Richard Chang)